More Bad News for China’s Troubled Tree Sector

Another Chinese forestry company is in the spotlight, at the same time as the U.S. steps up its scrutiny of Chinese companies listed there via reverse mergers.

Overnight in Canada, Hong Kong-based, Toronto-listed Sino-Forest Corp.’s shares plunged more than 20% and were suspended from trading, after a damning note by independent research firm Muddy Waters calling the company “a multi-billion dollar ponzi scheme.”

The note questions the authenticity of the company’s assets in Yunnan province, which it says is overstated by about US$900 million.

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